Private — Equity Interview Case Study Pdf

The Paper Tiger: Decoding the Private Equity Case Study PDF

In the high-octane world of Private Equity (PE) recruitment, the resume gets you the meeting, but the Case Study gets you the job.

Risk Assessment & Recommendation (10-15%): Conclude with a clear investment view and risk mitigation strategy . Real-World Practice Examples private equity interview case study pdf

Entry: $100M Purchase Price.
Year 1 EBITDA: $10M.
Year 3 EBITDA: $10M * (1.2)^3 = $17.28M.
Exit EV: $17.28M * 5x = $86.4M.
Debt Paid Down: $2M x 3 years = $6M.
Initial Debt: 5x * $10M = $50M.
Remaining Debt at Exit: $50M - $6M = $44M.
Equity Proceeds: $86.4M - $44M = $42.4M.
Initial Equity: $100M - $50M = $50M.
MOIC: $42.4M / $50M = 0.85x (Wait! That is a loss? Yes. In this case, you would tell the partner a soft "No" on the deal. That judgment call is what gets you hired.)

Common Trap: Fees are tax-deductible for the HoldCo, but you must fund them on day one. Many models deduct fees from equity incorrectly. The Paper Tiger: Decoding the Private Equity Case

Effective private equity (PE) interview case study preparation requires mastering both technical LBO modeling and investment intuition. Candidates often face varied formats, from 30-minute "paper" LBOs to intensive weekend-long take-home assignments. Top Case Study Guides and PDFs Entry: $100M Purchase Price

5. Critical Metrics to Calculate (Without Spreadsheet Errors)

Purchase Enterprise Value = Entry EBITDA × Entry Multiple.
Equity Contribution = Purchase EV – Total Debt.
Year 5 Exit EV = Exit EBITDA × Exit Multiple.
Net Debt at Exit = Beginning debt – Cumulative FCF (after interest/taxes).
Equity Value at Exit = Exit EV – Net Debt at Exit.
IRR (approximate): (Exit Equity / Invested Equity)^(1/5) – 1.
MOIC = Exit Equity / Invested Equity.

Build the Model: Construct a Leveraged Buyout (LBO) model using the "ASBICIR" method (Assumptions, Sources & Uses, Balance Sheet, Income Statement, Cash Flow, Interest, and Returns).